401(k) fee disclosures coming soon

Sunday

Surveys show that many workers don't know how much they shell out in 401(k) fees - or that they even pay them.

Surveys show that many workers don't know how much they shell out in 401(k) fees - or that they even pay them.

But can you blame employees? Fees aren't transparent, and account statements usually reflect the balance after the charges have been taken out. Yet employees likely will spend tens of thousands of dollars in investment and other 401(k)-related fees over their careers.

Many employers aren't sure of the true cost of their plan, although they have a duty to ensure that the fees are "reasonable."

The veil of mystery is supposed to be lifted this year. This would be a major shift for the 401(k) industry.

The U.S. Department of Labor has drawn up two regulations on fee disclosures. One will require plan service providers, such as record-keepers and investment advisers, to disclose to employers all the 401(k)-related payments they receive. Under the other, employees must receive information on the fees they pay for investment management and other services.

The Labor Department is expected to announce the final regulation on disclosures to employers any day now. But there's widespread speculation that the agency will once more extend the deadline - now set for April 1 - so that plan service providers have more time to comply.

Last month, the Securities Industry and Financial Markets Association, citing potential changes in the final rule, asked for another year or more to comply.

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